The Aussie dollar takes the top spot this week, benefiting from a rise in positive risk sentiment, a weak U.S. dollar, and positive economic updates from Australia.
Australia Headlines and Economic data
RBA cuts rates, announces A$100 billion bond-buying program – these moves were largely expect by the market, which is likely the reason why we saw the Aussie rally after the event in a “buy the rumor, sell the news” scenario.
Tuesday was also laced with positive global risk sentiment, potentially sparked by positive stimulus news from the U.K. during the London trading session (UK FCA to announce further proposals to support consumer credit borrowers impacted by coronavirus). This may have been a contributor to the Aussie’s gains as well.
Aussie volatility picked up quickly during the Asia session, more likely a move with broad market sentiment as the votes were starting to be counted for the U.S. Presidential and Congressional elections. Risk sentiment moved back and forth the flow as traders bounced back between fears of a long wait before we get the results, and false claims by Trump of winning the Presidential bid.
On top of the very positive trade data from Australia above, broad risk sentiment flipped positive during the London session to likely help Aussie bulls along. This sentiment was likely on traders getting more confident that a Biden win could bring about a massive stimulus program and less regulatory risk in the U.S.